Liability Insurance
General & Professional
Washington State
Adult Family Homes are required to obtain Commercial General & Professional Liability Insurance prior to admitting the first resident after issuance of the new adult family home license, or when 10 working days have passed since the issuance of the license...whichever event happens first.
General Liability Insurance for an Adult Family Home offers protection against third-party claims alleging bodily injury, property damage, or personal injury that may occur on the premises or as a result of the home's operations. This can include incidents involving residents, visitors, and employees.
Professional Liability Insurance for an Adult Family Home is a type of insurance coverage specifically designed to protect the facility and its operators from claims related to professional negligence, errors, omissions, or mistakes in the care and services provided to residents.
Another type of Professional Liability Insurance is known as Errors and Omissions Insurance (E&O). E&O insurance is typically tailored to specific professions, such as doctors, nurses, lawyers, consultants, financial advisors, real estate agents, and technology professionals. The coverage addresses the unique risks and challenges faced by each profession.
Property Insurance
Homeowner's vs. Commercial
Homeowner's Insurance and Commercial Property Insurance policies are two distinct types of insurance coverage designed for different purposes and property uses.
A common misconception is that Commercial Property Insurance is not required for Adult Family Homes because they are run in a residential property.
The truth is that it’s the Use of the property that matters.
Homeowner's Insurance is designed to cover residential properties and their contents against a specific set of risks, primarily related to homeowners' personal needs and activities. It covers personal property, liability, and the structure of the home itself when the property is used for personal, non-business purposes.
Commercial Property Insurance is specifically designed to cover business-related activities and the unique risks associated with operating a business. It covers property, equipment, and assets used in business operations. Higher coverage limits are available and more customizable options to tailor coverage to the specific needs of a business, including the option to include specialized coverage like business interruption and equipment breakdown.
When an Adult Family Home business starts to be run in a house that was originally purchased for a purely residential purpose, the nature of the property use changes significantly, leading to a shift in risk exposure. As a result, a standard Homeowner's Policy will not cover claims arising from business operations.
